You are here: Home » Finance » News » Banks
RBI cancels licence of Solapur-based Laxmi Co-operative Bank
RBI orders M&M Financial to stop loan recovery via third party
Business Standard

Solapur-based Laxmi Co-op Bank loses licence after failing RBI norms

Depositors to get insurance claim, amount of Rs 193.68 cr already paid out

RBI | Reserve Bank of India | RBI Policy

BS Reporter  |  Mumbai 

Photo: Bloomberg
Photo: Bloomberg

Solapur-based Laxmi Co-operative Bank ceased operations from Thursday after the (RBI) cancelled its licence for not having adequate capital and earning prospects.

The has requested the Commissioner for Cooperation and Registrar of Cooperative Societies, Maharashtra, to issue an order for winding up the bank and appoint a liquidator for the bank.

On liquidation, every depositor would be entitled to receive claim amount of his/her deposits up to a monetary ceiling of Rs 5 lakh from the Deposit and Credit Guarantee Corporation (DICGC). About 99 per cent of the bank’s depositors are entitled to receive the full amount from the DICGC.

The DICGC has already paid Rs 193.68 crore of the total insured deposits, said the in a statement.

Laxmi Co-operative was in breach of various provisions of Banking Act and in its present condition it would be unable to pay depositors in full. The continuance of the bank was prejudicial to the interests of its depositors. Public interest would be affected if the bank was allowed to carry on its business, said the .

Subscribe to Business Standard Premium

Exclusive Stories, Curated Newsletters, 26 years of Archives, E-paper, and more!

Insightful news, sharp views, newsletters, e-paper, and more! Unlock incisive commentary only on Business Standard.

Download the Business Standard App for latest Business News and Market News .

First Published: Thu, September 22 2022. 19:53 IST